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Money for Nothing? Universal Child Care and Maternal Employment

Author

Listed:
  • Havnes, Tarjei

    (Dept. of Economics, University of Oslo)

  • Mogstad, Magne

    (Statistics Norway)

Abstract

The strong correlation between child care and maternal employment rates has led previous research to conclude that a ordable and readily available child care is a driving force both of cross-country di erences in maternal employment and of its rapid growth over the last decades. We analyze the introduction of subsidized, universally accessible child care in Norway. Our precise and robust di erence-in-di erences estimates reveal that there is little, if any, causal e ect of child care on maternal employment, despite a strong correlation. Instead of increasing mothers' labor supply, the new subsidized child care mostly crowds out informal child care arrangements, suggesting a signi cant net cost of the child care subsidies.

Suggested Citation

  • Havnes, Tarjei & Mogstad, Magne, 2009. "Money for Nothing? Universal Child Care and Maternal Employment," Memorandum 24/2009, Oslo University, Department of Economics.
    • Handle: RePEc:hhs:osloec:2009_024
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    File URL: https://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2009/Memo-24-2009.pdf
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    Keywords

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    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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